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Trump loses to Obama...in monthly job gains

Raoul_Luke

I feel a bit lightheaded. Maybe you should drive.
In 2003 the Bush administration changed the liquidity rules and allowed banks to borrow up to $40 for every $1 in deposits. The previous limit was $15::$1.

What could go wrong? The banks were using the money to buy up derivatives...if the value of those investments dropped just 3% the bank was insolvent. At the same time Bush's appointee to the SEC laid off about 150 people from enforcements and investigations. There was one person left in the Office of National Risk Assessment....

Bush signed Tarp. Other than that his efforts were all meant to kick the can down the road and get out of town before they got worse.
That was investment banks, not maw and paw's savings accounts. And there's one other problem with your contention here - it isn't true:

Although our understanding of what instigated the 2008 global financial crisis remains at best incomplete, there are a few widely agreed upon contributing factors. One of them is a 2004 rule change by the U.S. Securities and Exchange Commission that allowed investment banks to load up on leverage.

This disastrous decision has been cited by a host of prominent economists, including Princeton professor and former Federal Reserve Vice- Chairman Alan Blinder and Nobel laureate Joseph Stiglitz. It has even been immortalized in Hollywood, figuring into the dark financial narrative that propelled the Academy Award-winning film Inside Job.

As Blinder explained in a Jan. 24, 2009 New York Times op-ed piece, one of what he listed as six fundamental errors that led to the crisis came “when the SEC let securities firms increase their leverage sharply.” He continued: “Before then, leverage of 12 to 1 was typical; afterward, it shot up to more like 33 to 1. What were the SEC and the heads of the firms thinking?”

More recently, Simon Johnson, a former chief economist at the IMF, said last November that the decision “by the Bush administration, by the SEC to allow investment banks to massively increase their leverage … in terms of the big mistakes in financial history, that’s got to be in the top 10.”

It is certainly true that leverage at the investment banks zoomed between 2004 and 2007, before the near collapse. And this narrative of the rule change has plenty of appeal — it serves up villains. Stupid SEC people! Greedy bankers! It also suggests regulators were in the pockets of the big banks, and it offers support for the narrative of financial deregulation that many put at the center of the crisis.

There’s just one problem with this story line: It’s not true. Nor is it hard to prove that. Look at the historical leverage of the big five investment banks — Bear Stearns, Lehman Brothers, Merrill Lynch, Goldman Sachs and Morgan Stanley. The Government Accountability Office did just this in a July 2009 report and noted that three of the five firms had leverage ratios of 28 to 1 or greater at fiscal year-end 1998, which not only is a lot higher than 12 to 1 but also was higher than their leverage ratios at the end of 2006. So if leverage was higher before the rule change than it ever was afterward, how could the 2004 rule change have resulted in previously impermissible leverage?


http://blogs.reuters.com/bethany-mclean/2012/03/19/the-meltdown-explanation-that-melts-away/

It's a good read and I suggest anyone interested in the facts read the whole thing...
 

Dawg

President
Supporting Member
And the agenda you support is the source of Hoovervilles around the country...no unemployment insurance, no safety net, no health care for the poor, no food stamps...if the people gather to demand government help we can just call out the national guard...like Hoover did.

Pray you don't lose your job. If you do you'll just have to wait for things to get better...worked out very well for Germany in 1933.

No, I do not support price controls... I do not support nationalizing businesses...If you cannot stand on the merits of your argument you seem to invent views I don't hold and have never expressed. That is simply dishonest of you.
So your fast food joint is in 'Hoovervilles'............you don't provide any of the above for you 35 employees!

I'm sure you're praying minimum wage doesn't go to $15@hour for your business, I hope it does, tomorrow.
 

EatTheRich

President
That was investment banks, not maw and paw's savings accounts. And there's one other problem with your contention here - it isn't true:

Although our understanding of what instigated the 2008 global financial crisis remains at best incomplete, there are a few widely agreed upon contributing factors. One of them is a 2004 rule change by the U.S. Securities and Exchange Commission that allowed investment banks to load up on leverage.

This disastrous decision has been cited by a host of prominent economists, including Princeton professor and former Federal Reserve Vice- Chairman Alan Blinder and Nobel laureate Joseph Stiglitz. It has even been immortalized in Hollywood, figuring into the dark financial narrative that propelled the Academy Award-winning film Inside Job.

As Blinder explained in a Jan. 24, 2009 New York Times op-ed piece, one of what he listed as six fundamental errors that led to the crisis came “when the SEC let securities firms increase their leverage sharply.” He continued: “Before then, leverage of 12 to 1 was typical; afterward, it shot up to more like 33 to 1. What were the SEC and the heads of the firms thinking?”

More recently, Simon Johnson, a former chief economist at the IMF, said last November that the decision “by the Bush administration, by the SEC to allow investment banks to massively increase their leverage … in terms of the big mistakes in financial history, that’s got to be in the top 10.”

It is certainly true that leverage at the investment banks zoomed between 2004 and 2007, before the near collapse. And this narrative of the rule change has plenty of appeal — it serves up villains. Stupid SEC people! Greedy bankers! It also suggests regulators were in the pockets of the big banks, and it offers support for the narrative of financial deregulation that many put at the center of the crisis.

There’s just one problem with this story line: It’s not true. Nor is it hard to prove that. Look at the historical leverage of the big five investment banks — Bear Stearns, Lehman Brothers, Merrill Lynch, Goldman Sachs and Morgan Stanley. The Government Accountability Office did just this in a July 2009 report and noted that three of the five firms had leverage ratios of 28 to 1 or greater at fiscal year-end 1998, which not only is a lot higher than 12 to 1 but also was higher than their leverage ratios at the end of 2006. So if leverage was higher before the rule change than it ever was afterward, how could the 2004 rule change have resulted in previously impermissible leverage?


http://blogs.reuters.com/bethany-mclean/2012/03/19/the-meltdown-explanation-that-melts-away/

It's a good read and I suggest anyone interested in the facts read the whole thing...
Very simple explanation: it took the commodities glut to turn that potential danger into actual catastrophe.
 

middleview

President
Supporting Member
Um, the law of supply and demand? Sheesh! You really don't have a clue about how an economy works, do you? Companies would stop laying off workers; people would start buying cars again; houses would start selling (and being built again)…when the markets cleared.

What was the "societal impact" of the lost decade of economic growth? What was the "societal impact" of 10 million workers becoming discouraged and dropping out of the labor market? What was the "societal impact" of the trillions of $ funneled to the bankers and financiers by the Fed in its effort to keep the markets from clearing?

Hoover did not "do nothing." Stop being disingenuous! Hoover was NOT a "free market" guy, an anti-interventionist. Don't take my word for it, lets go to the tape:

We might have done nothing. That would have been utter ruin. Instead we met the situation with proposals to private business and to Congress of the most gigantic program of economic defense and counterattack ever evolved in the history of the Republic. We put it into action…. No government in Washington has hitherto considered that it held so broad a responsibility for leadership in such times…. For the first time in the history of depression, dividends, profits, and the cost of living, have been reduced before wages have suffered…. They were maintained until the cost of living had decreased and the profits had practically vanished. They are now the highest real wages in the world.

Creating new jobs and giving to the whole system a new breath of life; nothing has ever been devised in our history which has done more for … "the common run of men and women." Some of the reactionary economists urged that we should allow the liquidation to take its course until we had found bottom…. We determined that we would not follow the advice of the bitter-end liquidationists and see the whole body of debtors of the United States brought to bankruptcy and the savings of our people brought to destruction.


Herbert Hoover on the campaign trail in 1932

Geez, that reads like one of your posts on this subject...
How can there be demand where there is no income to buy?

What Hoover had to say on the campaign trail is pretty much irrelevant. What he did was too little and too late.

Hoover's economic policies

Herbert Hoover's economic policies were not effective in attacking the effects of the Great Depression, although is less devastating times they might have had a fruitful impact. Some of his policies were:

  • Expansion of the Federal Farm Board (FFB) to include making loans to farm cooperatives in order to create "stabilization corporations" that would keep agricultural prices up and provide a method of handling excess production.
  • New and expanded public works projects which would help curtail unemployment.
  • He encouraged businesses not to cut wages or lay off workers in order to maintain individual purchasing power, critical to a stable economy. The plan failed due to the reality that businesses could not continue to pay a constant wage while demand dropped to a level that required lower prices. Companies had to lay off workers which only created a higher unemployment rate.
  • Hoover extended the scope of the federal government by increasing its involvement in agriculture, federal spending, international trade, immigration and wage and tax policy.
  • A balanced federal budget. Instead of increasing taxes to increase revenue, Herbert Hoover felt that cutting taxes would encourage more spending.
http://www.hooverforpresident.com/herbert-hoover-policies/562/

By the way...how many recessions were there from 1920 to 1929? 1920 to 1921, 1923 to 1924 and 1926 to 1927.... five recessions in just 10 years, ending in a major depression.

https://en.wikipedia.org/wiki/List_of_recessions_in_the_United_States

You say 10 million workers have dropped out of the workforce because they were discouraged. You ignore the fact that there are a number of reasons why people quit looking for jobs...retirement comes to mind. The LFPR climbed dramatically from the days of a single earner family in the 1960s.

The labor force in 2008 was 153,144,000. That is the number of people between the ages of 16 and dead....who are not employed by government or institutionalized.

In 2016 the labor force was 159,736,000...and now it is 160,597,000 (December 2017).

https://data.bls.gov/cgi-bin/surveymost

In 2009 the LFPR was 65.7% and was 62.7% at the end of 2016...and is still 62.7%. Somehow the trumpsters think there is dramatic success in what Trump has done...based on what? The DJIA?

If you do the math you'd find that the number of people employed at the beginning of 2009 it was 99,543,600. At the end of 2016 that number was 99,036,320.

Again...10 million people dropped out of the work force? Just keep making shit up...I find it entertaining as hell.
 

middleview

President
Supporting Member
Actually, the "Great Recession" (like the Great Depression) actually occurred on the Democratic successor's watch. The "Great Recession" (like the Great Depression) was pretty much over by the time the new (democratic) administration settled in (and started getting their policies implemented). The "Great Recession" (like the Great Depression) refers to the lack of a full recovery for a decade after the downturn ended. But thanks to lefty historians and news operations, and millions of gullible people like you, the meme survives that it was all because of what happened before the anti-capitalist policies were applied. But I think we got our proof of that in 2017, when despite Trump's failure to get any legislation passed, and simply through Executive Actions that rolled back much of the Obama agenda, we saw the economy (finally) recover back to its long term GDP growth trend, we saw a resurgence in manufacturing jobs, we saw businesses actually expanding and repatriating investment in the US economy. I know, that's a rather nuanced take, and you lefties don't do nuance, but it is what it is...
When the "great depression" ended it simiply means that the GDP is growing again...not that the effects of the depression have disappeared. We had an 8% drop in GDP in 2008.

It was a world wide recession...unlike Reagan's which was pretty much entirely in the US.

FDR immediately acted to prevent more bank failures. How many banks failed in 1932 vs 1933? By the time FDR was sworn in over 11,000 out of 25,000 banks had failed.
No safety net and if your money was in that bank....too bad.

Trump has thrown out a few of Obama's regulations...less than 30. His tax legislation is much like Bush's....buy votes by getting tax cuts that you have to borrow to pay for. When people realize the impact on the national debt they won't be so cheerful about it.
 

Raoul_Luke

I feel a bit lightheaded. Maybe you should drive.
How can there be demand where there is no income to buy?

What Hoover had to say on the campaign trail is pretty much irrelevant. What he did was too little and too late.

Hoover's economic policies

Herbert Hoover's economic policies were not effective in attacking the effects of the Great Depression, although is less devastating times they might have had a fruitful impact. Some of his policies were:

  • Expansion of the Federal Farm Board (FFB) to include making loans to farm cooperatives in order to create "stabilization corporations" that would keep agricultural prices up and provide a method of handling excess production.
  • New and expanded public works projects which would help curtail unemployment.
  • He encouraged businesses not to cut wages or lay off workers in order to maintain individual purchasing power, critical to a stable economy. The plan failed due to the reality that businesses could not continue to pay a constant wage while demand dropped to a level that required lower prices. Companies had to lay off workers which only created a higher unemployment rate.
  • Hoover extended the scope of the federal government by increasing its involvement in agriculture, federal spending, international trade, immigration and wage and tax policy.
  • A balanced federal budget. Instead of increasing taxes to increase revenue, Herbert Hoover felt that cutting taxes would encourage more spending.
http://www.hooverforpresident.com/herbert-hoover-policies/562/

By the way...how many recessions were there from 1920 to 1929? 1920 to 1921, 1923 to 1924 and 1926 to 1927.... five recessions in just 10 years, ending in a major depression.

https://en.wikipedia.org/wiki/List_of_recessions_in_the_United_States

You say 10 million workers have dropped out of the workforce because they were discouraged. You ignore the fact that there are a number of reasons why people quit looking for jobs...retirement comes to mind. The LFPR climbed dramatically from the days of a single earner family in the 1960s.

The labor force in 2008 was 153,144,000. That is the number of people between the ages of 16 and dead....who are not employed by government or institutionalized.

In 2016 the labor force was 159,736,000...and now it is 160,597,000 (December 2017).

https://data.bls.gov/cgi-bin/surveymost

In 2009 the LFPR was 65.7% and was 62.7% at the end of 2016...and is still 62.7%. Somehow the trumpsters think there is dramatic success in what Trump has done...based on what? The DJIA?

If you do the math you'd find that the number of people employed at the beginning of 2009 it was 99,543,600. At the end of 2016 that number was 99,036,320.

Again...10 million people dropped out of the work force? Just keep making shit up...I find it entertaining as hell.
As usual (for you) you have a) it backwards and b) a series of flaccid anecdotes.

You can't get income unless you produce something and get paid for it. The idea that this simple fact is foreign to you renders you unserious on this subject. When there is over-production, borrowing in an attempt to maintain demand is simply robbing demand from the future. It is (literally) like pulling buckets of water out of one end of the pool and pouring it back in the other end.

What Hoover "did" wasn't nothing. Thanks for admitting it. This is the same claptrap criticism of Bush (and, frankly, FDR and Obama) - "it just wasn't enough." Bullshit! That's just Keynesian economic revisionism. It's never "enough" because it doesn't work (for the reason outlined above). War is the exception that proves the rule. You can make it appear to work if you create demand for non-traditional goods - so you can get around the pool fallacy mentioned above. That said, if FDR's policies had still been in effect after the war, we'd have been right back to depression conditions when it ended. So "stimulus" will never ever ever ever be "big enough" to fix the economy, because it is precisely comprised of the sorts of economic contortions that CAUSE recessions. The reason we know this is simple - Japan. There is really no precedence, even in war time, that approaches the extent to which the Japanese have used Keynesian policy to distort and maim their economy. And they are entering their third decade of stagnation. That's what you people want for America and we are idiots if we let you run this economic film flam after the massive extent to which it has been shown (repeatedly) to have failed (miserably).

Five "recessions?" During the era we refer to as "the roaring twenties?" Is that so? Apparently they were over pretty quick, thanks to having (anti-interventionists) Andrew Mellon at Treasury and Cooledge in the WH. Thanks for making my point!

And your labor "analyses" are always drivel. I can't even figure out what your point is in that hodgepodge of meaningless stats. But as I pointed out elsewhere, while job creation slackened in 2017 over 2016, total labor hours went up by more in 2017 than in 2016 - so the jobs are not just better quality because so many are being (re)created in the manufacturing sector, but also because a bigger percentage of them are full time. So yeah, that's success, whether you (or I) like it or not. I am no fan of Trump, but I am a champion of the facts (unlike you).
 

Raoul_Luke

I feel a bit lightheaded. Maybe you should drive.
When the "great depression" ended it simiply means that the GDP is growing again...not that the effects of the depression have disappeared. We had an 8% drop in GDP in 2008.

It was a world wide recession...unlike Reagan's which was pretty much entirely in the US.

FDR immediately acted to prevent more bank failures. How many banks failed in 1932 vs 1933? By the time FDR was sworn in over 11,000 out of 25,000 banks had failed.
No safety net and if your money was in that bank....too bad.

Trump has thrown out a few of Obama's regulations...less than 30. His tax legislation is much like Bush's....buy votes by getting tax cuts that you have to borrow to pay for. When people realize the impact on the national debt they won't be so cheerful about it.
Nope. When the "great depression" ended it "simply means" that the economy regained its pre-recession level of growth, jobs, incomes, industrial production, capex, etc. The end of the "great depression" is variously given as 1938 or 1939 (essentially the beginning of the war preparation). Not 1932, 1939!

Screen Shot 2018-01-07 at 12.11.18 PM.png

FDR owns the lion's share of it.

As for Trump's regulatory rollback, it's way more than "less than 30:"

https://www.washingtonpost.com/news/fact-checker/wp/2017/10/12/has-trump-cut-more-regulations-than-any-president-in-history/?utm_term=.e297184c57c9

Even the biased WaPo has to admit he's making quite a bit of progress on that front.

I tend to agree on the tax legislation, although the leveling of the corporate tax playing field is liable to produce knock on economic benefits even if it (technically) doesn't lower taxation overall.
 

middleview

President
Supporting Member
As usual (for you) you have a) it backwards and b) a series of flaccid anecdotes.

You can't get income unless you produce something and get paid for it. The idea that this simple fact is foreign to you renders you unserious on this subject. When there is over-production, borrowing in an attempt to maintain demand is simply robbing demand from the future. It is (literally) like pulling buckets of water out of one end of the pool and pouring it back in the other end.

What Hoover "did" wasn't nothing. Thanks for admitting it. This is the same claptrap criticism of Bush (and, frankly, FDR and Obama) - "it just wasn't enough." Bullshit! That's just Keynesian economic revisionism. It's never "enough" because it doesn't work (for the reason outlined above). War is the exception that proves the rule. You can make it appear to work if you create demand for non-traditional goods - so you can get around the pool fallacy mentioned above. That said, if FDR's policies had still been in effect after the war, we'd have been right back to depression conditions when it ended. So "stimulus" will never ever ever ever be "big enough" to fix the economy, because it is precisely comprised of the sorts of economic contortions that CAUSE recessions. The reason we know this is simple - Japan. There is really no precedence, even in war time, that approaches the extent to which the Japanese have used Keynesian policy to distort and maim their economy. And they are entering their third decade of stagnation. That's what you people want for America and we are idiots if we let you run this economic film flam after the massive extent to which it has been shown (repeatedly) to have failed (miserably).

Five "recessions?" During the era we refer to as "the roaring twenties?" Is that so? Apparently they were over pretty quick, thanks to having (anti-interventionists) Andrew Mellon at Treasury and Cooledge in the WH. Thanks for making my point!

And your labor "analyses" are always drivel. I can't even figure out what your point is in that hodgepodge of meaningless stats. But as I pointed out elsewhere, while job creation slackened in 2017 over 2016, total labor hours went up by more in 2017 than in 2016 - so the jobs are not just better quality because so many are being (re)created in the manufacturing sector, but also because a bigger percentage of them are full time. So yeah, that's success, whether you (or I) like it or not. I am no fan of Trump, but I am a champion of the facts (unlike you).
You continue to confuse facts and opinion.

You can't get income unless you produce something and get paid for it. The idea that this simple fact is foreign to you renders you unserious on this subject. When there is over-production, borrowing in an attempt to maintain demand is simply robbing demand from the future. It is (literally) like pulling buckets of water out of one end of the pool and pouring it back in the other end.

You cannot produce something unless there is someone to buy it. You seem to ignore the need to have customers. Your wimpy assed attempt to compare a swimming pool to the relationship between demand and supply is weird.

I already provided you with information on a dramatic increase in investments in manufacturing that happened in 2016...that is why manufacturing has picked up now.

When you refer to the 10 million people who have dropped out of the labor force...I provide an analysis which shows the exact number of people...and it ain't 10 million. Instead of admitting that there wasn't any 10 million...you try the "your analysis is drivel"....More hours doesn't indicate better quality. I noticed you did not include a source to back up your hours worked stat....
 

middleview

President
Supporting Member
Nope. When the "great depression" ended it "simply means" that the economy regained its pre-recession level of growth, jobs, incomes, industrial production, capex, etc. The end of the "great depression" is variously given as 1938 or 1939 (essentially the beginning of the war preparation). Not 1932, 1939!

View attachment 38161

FDR owns the lion's share of it.

As for Trump's regulatory rollback, it's way more than "less than 30:"

https://www.washingtonpost.com/news/fact-checker/wp/2017/10/12/has-trump-cut-more-regulations-than-any-president-in-history/?utm_term=.e297184c57c9

Even the biased WaPo has to admit he's making quite a bit of progress on that front.

I tend to agree on the tax legislation, although the leveling of the corporate tax playing field is liable to produce knock on economic benefits even if it (technically) doesn't lower taxation overall.
The depression started in 1929 and reached it's worst point in early 1933. By 1937 the unemployment rate had been cut in half. The NBER says the depression ended in 1933.
https://en.wikipedia.org/wiki/List_of_recessions_in_the_United_States
 

middleview

President
Supporting Member
Five "recessions?" During the era we refer to as "the roaring twenties?" Is that so? Apparently they were over pretty quick, thanks to having (anti-interventionists) Andrew Mellon at Treasury and Cooledge in the WH. Thanks for making my point!
According to a 1989 analysis by Milton Friedman and Anna Schwartz, the recession of 1920–21 was the result of an unnecessary contractionary monetary policy by the Federal Reserve Bank.[13] Paul Krugman agrees that high interest rates due to the Fed's effort to fight inflation caused the problem. This did not cause a deficiency in aggregate demand but in aggregate supply. Once the Fed relaxed its monetary policy, the economy rapidly recovered.

https://en.wikipedia.org/wiki/Depression_of_1920–21#Causes
 

middleview

President
Supporting Member
The only problem with that is that you DO! When the government props up failing businesses to maintain supply, above the level of current demand, that is a form of "price control." When the government "enhances" unemployment benefits, in effect keeping wages from declining to the equilibrium market level, that is a form of "price control." So you in fact DO support "price controls" - the ones that keep prices ABOVE the level implied by current supply and demand, in order to placate the masses. Why on earth would you choose to NOT support turning around and forcing prices BELOW the level implied by current supply and demand, in order to placate the masses?

These sorts of interventions are defacto (temporary) nationalizations. So you support "nationalization" of the markets, because it gives you the same outcome, while providing "plausible deniability" regarding what, exactly, it is that you support.
The failure of GM would not have created as much a problem with demand as the problem with jobs...The impact would have rippled through a number of areas...a large drop in tax revenue for one and a big bump in unemployment, housing assistance...food stamps.

If a million people had lost their jobs it would have decreased demand...further destabilizing supply.

How you think that would have been a good thing or would have ended the Bush recession any earlier or encouraged a recovery is beyond logic. If GM and Chrysler had gone under I am sure the Japanese and Korean manufacturers would have picked up production...but not with US employees. Of course...that isn't a problem, is it?
 

middleview

President
Supporting Member
This is a Twitter account. It's not FoxNews. And those numbers are wrong. In Trump's first year he created more high paying jobs than all eight of Obama's years combined. The economy is expanding and the Dow is at record highs, NONE OF WHICH OBAMA HAD ANYTHING WHATSOEVER TO DO WITH.

Obama was the worst president in history, with the worst unemployment in history. That nightmare is OVER.
Unemployment was 10.8% in November 1982. Obama wasn't president.
It hit 25% in 1933...when Hoover was president....
Unemployment in 2009 hit 10%.
 

Spamature

President
That is totally incorrect....the Global Money Supply was in a death spiral....there was nothing wrong with the economy until the money bomb went off and thousands of companies had to close and lay off workers including Wall Street...the London financial houses and the European central banks.....none of this had anything in a practical way to do with either Bush or Obama btw.....that is nothing more than a political fairy tale. If anything Bush saved the US by taking emergency measures to restore working cash to the thieves who nearly bankrupted the world.

You're characterization here is like amputating a leg from an elephant to reattach it to a kangaroo.....


JO
Then why did the economy lose 4 million additional jobs and the stock market thousands of points in the following 6 months after the bush bailout cash hit their accounts ?
 
D

Deleted member 21794

Guest
Why would you expect it to suddenly stop shedding jobs with no intervention?
What market force would have saved GM without people actually buying cars? What would the societal impact be of a continued foreclosure rate as it was in 2006/2007? Why would anyone build homes with so many vacant?

Nobody said the layoffs would continue at that rate forever. They could certainly have continued until unemployment hit 25% or worse. That is what happened when Hoover was president...he did nothing and the result was obvious.
Wow, when did people ever stop buying cars??????
 

justoffal

Senator
In 2003 the Bush administration changed the liquidity rules and allowed banks to borrow up to $40 for every $1 in deposits. The previous limit was $15::$1.

What could go wrong? The banks were using the money to buy up derivatives...if the value of those investments dropped just 3% the bank was insolvent. At the same time Bush's appointee to the SEC laid off about 150 people from enforcements and investigations. There was one person left in the Office of National Risk Assessment....

Bush signed Tarp. Other than that his efforts were all meant to kick the can down the road and get out of town before they got worse.
I don't agree with the 40 to 1 leveraging
But that is not what tripped the money supply into the great international flushola.

Sure leveraging made the problem worse because it allowed the original bandits to do what they had been doing right along only to do more of it.

The original action taken by some obscure figure in the backroom European bank .... who demanded to see real assets in exchange for a paper promise.....was tantamount to toppling the initial Domino in a line that was hundred miles long.
Within 48 hours it became apparent that the trail led back to a giant asset bubble worth more than 10 trillion of imaginary wealth ......it simply did not exist.

That's when all the central banks pulled back their credit promises .... that's when all the payroll institutions put a freeze on the money flow..... that's when all the capital vendors locked the cabinet doors because they had no idea what was coming next in the face of real accounting. Nobody knew who owed what to who or what the promise was worth.

This was all made possible by the unethical forcing of junk mortgage contracts into high-level financial products called derivatives (as you noted) ... it followed directly on the heels of government interference some decades before forcing midsize and small banks to do community lending whilst turning a blind eye both to credit qualifications and asset base.

It took 20 years of bad business practice to inflate the $10 trillion bubble.... it only took 48 hours to let the air out of it.

Jo
 
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Raoul_Luke

I feel a bit lightheaded. Maybe you should drive.
The failure of GM would not have created as much a problem with demand as the problem with jobs...The impact would have rippled through a number of areas...a large drop in tax revenue for one and a big bump in unemployment, housing assistance...food stamps.

If a million people had lost their jobs it would have decreased demand...further destabilizing supply.

How you think that would have been a good thing or would have ended the Bush recession any earlier or encouraged a recovery is beyond logic. If GM and Chrysler had gone under I am sure the Japanese and Korean manufacturers would have picked up production...but not with US employees. Of course...that isn't a problem, is it?
Really?

A) In case you haven't noticed, "foreign" cars are increasingly made in America, by Americans.

B) What, exactly, did we save them for?

North American vehicle production by the unionized Detroit 3 automakers will fall behind the combined North American output of automakers from Europe and Asia, along with Tesla, for the first time this year…

https://jalopnik.com/detroits-big-three-may-not-dominate-north-american-car-1818877016

See, this is the problem with these government interventions to "fix" what is wrong in the markets - all they can do is delay the inevitable. The market always (ALWAYS) wins in the end. This is precisely why it is much better to just speed it along by keeping the government out of the way. If you ask me, if they hadn't bailed out GM and Chrysler, and they'd been bought out of bankruptcy by deep pocketed financiers, who would have resurrected them as non-union shops that could better compete with the foreign brands, the American worker would have been much, much better off.

Thanks for giving me this opportunity to show how you are wrong, once again...
 

Raoul_Luke

I feel a bit lightheaded. Maybe you should drive.
According to a 1989 analysis by Milton Friedman and Anna Schwartz, the recession of 1920–21 was the result of an unnecessary contractionary monetary policy by the Federal Reserve Bank.[13] Paul Krugman agrees that high interest rates due to the Fed's effort to fight inflation caused the problem. This did not cause a deficiency in aggregate demand but in aggregate supply. Once the Fed relaxed its monetary policy, the economy rapidly recovered.

https://en.wikipedia.org/wiki/Depression_of_1920–21#Causes
Yes, so bad government policy caused the Depression of 1920-21. I'm glad we could finally agree on the fact that the free market isn't the root of all economic problems.

And, in this example of yours, once the bad policy was reversed, the economy quickly (and fully) recovered. So, similarly, Obama wasn't "locked into" the Bush downturn because of conditions he "inherited." Glad we can agree on that as well.

Do you ever get tired of making my arguments for me?
 

Raoul_Luke

I feel a bit lightheaded. Maybe you should drive.

Raoul_Luke

I feel a bit lightheaded. Maybe you should drive.
You continue to confuse facts and opinion.

You can't get income unless you produce something and get paid for it. The idea that this simple fact is foreign to you renders you unserious on this subject. When there is over-production, borrowing in an attempt to maintain demand is simply robbing demand from the future. It is (literally) like pulling buckets of water out of one end of the pool and pouring it back in the other end.

You cannot produce something unless there is someone to buy it. You seem to ignore the need to have customers. Your wimpy assed attempt to compare a swimming pool to the relationship between demand and supply is weird.

I already provided you with information on a dramatic increase in investments in manufacturing that happened in 2016...that is why manufacturing has picked up now.

When you refer to the 10 million people who have dropped out of the labor force...I provide an analysis which shows the exact number of people...and it ain't 10 million. Instead of admitting that there wasn't any 10 million...you try the "your analysis is drivel"....More hours doesn't indicate better quality. I noticed you did not include a source to back up your hours worked stat....
Where does that person get the money to buy what you produced - the "aggregate demand" fairy? There can be no consumption without the capacity to fund demand (which, lets face it, is infinite). Everyone has to produce something if they want to participate in the economy. I'm sorry to have to break this to you, but you didn't discover the "free lunch."

The universal focus on demand and consumption is typical of the socialist economic viewpoint. Producers must be derided and workers become the center of the economic universe. Frankly it doesn't surprise me that you have this viewpoint.

As for the "wimpy assed" swimming pool analogy, it's actually a pretty good one. Borrowing to consume is just stealing demand from the future. If you are borrowing to invest, then you will in fact create new demand by…wait for it…increasing production to fund it. This really isn't rocket science, unless you are stuck on the Keynesian kraziness.

As for your labor force "analysis" was that what you were trying to show? Why didn't you just get the BLS data on the number "not in labor force:"

Screen Shot 2018-01-07 at 3.56.35 PM.png

Looks like an increase of 15 million (or so) to me.
 
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